PRESS BRIEFING ON DECISION BY ARBITRAL TRIBUNAL IN COMMERCIAL DISPUTE BETWEEN UNITED NATIONS AND SKYLINK AVIATION
Press Briefing
PRESS BRIEFING ON DECISION BY ARBITRAL TRIBUNAL IN COMMERCIAL DISPUTE BETWEEN UNITED NATIONS AND SKYLINK AVIATION
19990709
An arbitral tribunal today issued its decision in favour of the United Nations in a commercial dispute between the Organization and the Canadian company, SkyLink Aviation, Inc., Bruce Rashkow, Director, General Legal Division, Office of Legal Affairs, told correspondents at a Headquarters press briefing.
Reading a statement on behalf of the Under-Secretary-General for Legal Affairs and United Nations Legal Counsel, Hans Corell, and Under-Secretary- General Joseph Connor, Department of Management, Mr. Rashkow said the United Nations welcomed the judgement and the resolution of that "very difficult and protracted dispute" that had given rise to the arbitration initiated by SkyLink Aviation, Inc. and other claimants in December 1996. Their contention was that the United Nations had violated a 1994 settlement agreement -- when the United Nations had paid SkyLink Aviation, Inc. almost $7 million -- resolving a number of specific claims related to services rendered to the Organization for peacekeeping missions during the early 1990s. They sought about $50 million in compensation.
The claimants alleged that the United Nations had breached a contractual obligation under the agreement to conduct what they described as normal business relations with them, he said. Since then, they stated, they had been unfairly treated during investigations conducted by the Office of Internal Oversight Services, which had resulted in severe criticism of the company. They also felt that they had been discriminated against in the procurement of aviation services for peacekeeping missions. However, all of the claims were dismissed and no damages were awarded. Meanwhile, the Secretariat was presently reviewing the over 130-page tribunal decision and would give its comments later.
The tribunal had criticized the methods of the Office of Internal Oversight Services while conducting investigations on the allegations of SkyLink Aviation, Inc. and the extent to which the United Nations had relied on those investigations and their findings, Mr. Rashkow said. He emphasized the Office of Internal Oversight Services had been established "to investigate potential violations of United Nations regulations, rules and administrative issuances, and allegations of misconduct, mismanagement and waste of resources, as well as the abuse of authority". Also, those investigations were internal and confidential, and were conducted to enable the Secretary- General and the relevant departments to "more effectively and efficiently achieve their mandates" and to protect the interests of the Organization.
Legal Counsel Briefing - 2 - 9 July 1999
He noted that it was incumbent on the United Nations to seriously respond to the findings and recommendations of the Office of Internal Oversight Services, particularly, as in this case, when they involved the integrity of the procurement process and the safety of air services. Following the investigation, the Organization had conducted a review of the relevant findings by the substantive offices concerned. In the review process, the claimants had been given opportunity to and had submitted their views twice on the relevant findings of the Oversight Office. Moreover, in light of the tribunal's criticism and other developments, the Office was expected to review its operations shortly.
Responding to a question on whether the company had been prevented from bidding for contracts in 1997 from the United Nations, Mr. Rashkow said that they had been removed from the roster list and a company had to be on that list to be able to bid. He added that, since then, there had been no action by either party to restore SkyLink Aviation, Inc. to that list. "The prohibition from that list lasted only until May 1999", he noted.
Asked whether there were serious allegations against the United Nations after the 1994 settlement, Mr. Rashkow informed correspondents that the Oversight Office did report serious allegations relating to the integrity of the Organization's procurement process and other matters. He added that there were actions being taken regarding that process.
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